Danielle Buttenshaw v Ritek Technology
[2023] FWC 1525
•15 AUGUST 2023
| [2023] FWC 1525 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Danielle Buttenshaw
v
Ritek Technology
(U2022/11680)
| DEPUTY PRESIDENT LAKE | BRISBANE, 15 AUGUST 2023 |
Application for an unfair dismissal remedy – allegations of poor work performance – summary dismissal – procedural fairness not provided – compensation awarded.
Ms Danielle Buttenshaw (the Applicant) brought an application to the Fair Work Commission (the Commission) seeking a remedy pursuant to s.394 of the Fair Work Act 2009 (the Act) stating she that was unfairly dismissed from Ritek Technology Pty Ltd (the Respondent).
The Applicant commenced her employment with the Respondent since 13 September 2022 in various capacities related to logistics, procurement, drafting and scheduling in a full-time capacity.
The Applicant was dismissed on 28 November 2022, and she lodged this application with the Commission on 9 December 2022, within 21 days, as required by the Act.[1] The Applicant is protected from unfair dismissal and the dismissal did not involve a genuine redundancy.[2] There were contentions whether the Applicant had undertaken the minimum employment period. This was determined in PR761100.[3] The Respondent did not rely on the Small Business Fair Dismissal Code.
A conference was held on 3 May 2023. Directions were issued for a hearing which was held on 24 May 2023. The Applicant was self-represented, and Mr San Hadid appeared for Respondent.
Background
Applicant’s Submissions
The Respondent operates a plant in Cooroy which was previously owned by different entities. The Applicant had been employed by an older entity that operated the Cooroy plant and she her employment had transferred over with the current entity, Ritek Technology.
The Applicant submits that prior to her dismissal on 28 November 2022, that there were employee shortages and that she had been dealing with multiple duties such as training another staff member to take over some of her duties.
On 25 November 2022, the Applicant stated that she was dealing with multiple requests that needed to be resolved as soon as possible. Mr Jamie Somerville-Kimlin (General Manager) stated that the Applicant needed to focus on drafting only. The Applicant stated that if she did not focus on drafting, the Respondent would find someone who will. The Applicant then stated that she contacted Mr Sam Hadid (the CEO) and he stated to her that the incident would be sorted. The Applicant stated to Mr Hadid that she could not work further this day as she was upset and distressed. The Applicant was instructed to go home for the day by Mr Hadid.
After the conversation with Mr Hadid, the Applicant had a discussion with Mr Somerville-Kimlin and stated she would not have an issue with focusing on drafting but had not been able to hand over some of her roles because they were complicated, and that the staff member who was going to take over some of Ms Buttenshaw’s duties was not performing in those roles.
The Applicant received a text on 26 November 2022 from Mr Somerville-Kimlin stating, ‘Do not come in Monday, Call me when you get a chance thx’.
The Applicant received a text on 27 November 2022 from Mr Sommerville-Kimlin stating, ‘Danielle did u get my message yesterday?’
On 28 November 2022, the Applicant attempted to call Mr Sommerville-Kimlin, but received an automated message. The Applicant was informed by phone call on this day that the Respondent would terminate her employment effective immediately with two (2) weeks’ pay.
On 2 December 2022, the Applicant had sent an email to the Respondent regarding her dismissal and stated how her role had been threatened because she did not work 100% in drafting and requested a separation certificate. The Applicant states that there was an error with the dismissal date in the separation certificate which the Respondent did not respond to.
On 5 December 2022, the Applicant received a text message from Mr Sommerville-Kimlin asking her to contact another staff member to pick up a company laptop before making any final payments. The laptop was returned to the Respondent.
On 20 December 2022, the Applicant had contacted Mr Hadid regarding her financial situation and wanted to discuss outstanding pay owed.
The Applicant had submitted three witness statements, but they do not have much relevance in addressing the merits of her unfair dismissal as they were statements of her work performance prior to being employed by the Respondent.
The Applicant is seeking compensation and unpaid superannuation and leave which she states was accumulated from the previous companies that had operated the Cooroy Plant. The Applicant states if there were any performance issues, she should have been notified of these issues which would have given her an opportunity to improve or address.
Respondent’s Submissions
The Respondent seeks for the matter to be dismissed as she was warned about prior performance issues.
The Respondent states that there were a number of issues with the Applicant’s work performance. The Respondent undertook an organisational restructure and were assessing issues with the Cooroy office. The Respondent states that the Applicant’s attitude in addressing mistakes, along with her quality of work, along with her failure to respond to feedback and direction resulted in her dismissal as it would cause ongoing financial and reputational risk to the business.
The Respondent had identified mistakes with the Applicant’s performance including errors on booking trucks which would cost the Respondent and their clients back charges for these mistakes.
Other issues raised were procurement mistakes, drafting mistakes, breach of confidentiality, spending time in the factory floor when requested to undertake her reassigned duty, leaving work early and failure to take instructions from her manager.
Mr Somerville-Kimlin stated that these mistakes were discussed in emails from 12 October 2022 to 7 November 2022, where the Applicant made an error in not booking the deliveries at the appropriate time. Mr Somerville-Kimlin states that these mistakes were discussed with the Applicant on multiple occasions, but that the Applicant had told Mr Haris to deal with this mistake himself when asked to rectify the error. The Applicant acknowledged that she had made the error but was unable to rectify it once the delivery was in process.
Mr Somerville-Kimlin stated that once she had made the error, the Respondent had tried to transition her role to drafting and several meetings were arranged in a 2-month period. The Applicant was instructed that the new staff would take over some of her duties. The Respondent stated that the Applicant was being difficult in undertaking the new role, and when she did undertake the role, she made costly errors.
On the date of the Applicant’s dismissal, Mr Sommerville-Kimlin had overheard a conversation that she was still undertaking her old duties rather than what she was asked to do which was to focus on drafting. The Respondent stated that the Applicant was being reluctant to undertake her new role.
Was the Applicant unfairly dismissed?
Section 387 of the Act provides the criteria which the Commission must take into account when deciding if the dismissal was harsh, unjust, or unreasonable. As required by the Act, I note the following:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
(a) Valid reason for the dismissal:
It is well established that the factual basis for the reason for dismissal will not of itself demonstrate the existence of a valid reason.[4] It must, as s.387(a) makes clear, be a valid reason for dismissal. A valid reason for dismissal should be “sound, defensible or well founded”[5] and should not be “capricious, fanciful, spiteful or prejudiced.”[6] As summarised by the then Deputy President Asbury in Smith v Bank of Queensland Ltd, a “dismissal must be a justifiable response to the relevant conduct or issue of capacity”.[7]
I do not consider factors such as breach of confidentiality, spending time on the factory floor or tardiness as valid reasons of dismissal. This was not raised with the Applicant in her dismissal.
The Respondent stated that she was dismissed on the basis that the business ‘no longer required her services’. The Respondent stated that through an organisational review, they had identified her poor performance causing financial loss, and decided to outsource her role. This was supported by the Witness Statement of Mr Haris Jamil (Financial Controller), Mr Sam Hadid (CEO) and Mr Sommerville-Kimlin.
The Respondent had provided an email trail of the truck booking error, and orders undertaken through a system which she was asked not to use because of the higher cost.
Furthermore, the Applicant was clearly informed in an email on 22 November 2022 that she was to handover her duties and that she would be required to focus on drafting. I acknowledge that there may be difficulties for the Applicant as both parties acknowledged that they were understaffed during this time. However, this was no longer the Applicant’s duty, and she did not appear to comply with the request from her employer.
The Respondent identified that the Applicant was not performing as per their operational requirements and established examples of these instances.
The Respondent had a valid reason for dismissal.
(b) Notification of reason and (c) Opportunity to respond:
Although the employer is not required to take any ‘particular steps’ in carrying out the dismissal, it is commonly accepted practice that notice in explicit, plain and clear terms must be given regarding termination of an employee except in cases of serious misconduct.[8] This should be applied in a commonsense way to ensure that the employee is treated fairly and should not be burned with formality.[9]
Commissioner McKinnon in Galanopoulos v Australian Handrails Pty Ltd [2018] FWC 3569 at [43] had determined that verbal warnings that were not sufficiently connected to the Applicant in their dismissal, or if the verbal warning did not communicate that the Applicant was at risk of being dismissed if their performance did not improve indicated that the Applicant was not notified of their dismissal.
Although there may have been valid reasons for dismissal, the Respondent had never raised these issues as a factor of dismissal or had provided evidence of this besides their oral evidence. The Applicant was notified that her role was changing to drafting but was not informed that her work performance was not satisfactory until the date of termination.
I find that the Applicant was not given an opportunity to respond to her mistakes or failure to perform her duties as requested as she was summarily dismissed on 28 November 2022.
(d) Unreasonable refusal by the employer to allow the Applicant a support person:
There is no positive obligation on an employer to offer an employee the opportunity to have a support person and is only relevant when an employee asks to have a support person present in a discussion relating to dismissal and the employer unreasonably refuses.[10] The Applicant did not ask to have a support person during the phone call, as such this factor is not relevant.
(e) Warning of unsatisfactory performance before the dismissal:
The Respondent submitted the Applicants’ performance was unsatisfactory on several occasions.
However, there was no evidence of these unsatisfactory performance before the dismissal beside oral evidence provided by the Respondent. In the absence of evidence regarding warnings of unsatisfactory performance, I am not satisfied that sufficient evidence was provided to conclude a finding that the Applicants received any warning of unsatisfactory performance prior to dismissal.
(f) Size of employer’s enterprise, and (g) impact on procedures caused by absence of dedicated human resources:
The Respondent is a small business with 15 employees. The Respondent submitted that it did not have a dedicated human resources department. The Respondent did not note any show cause meeting, or written warnings and relied on the fact that the Applicant was warned verbally. I take into consideration that the Respondent’s business did not have the resources of a larger organisation in this matter which would have led to a less formal process.
(h) any other matters that the FWC considers relevant:
As the Applicant was summarily dismissed, I consider whether there was serious misconduct is defined in regulation 1.07 of the Fair Work Regulations 2009 (Cth) as follows:
1.07 Meaning of serious misconduct
(1) For the definition of serious misconduct in section 12 of the Act, serious misconduct has its ordinary meaning.
(2) For subregulation (1), conduct that is serious misconduct includes both of the following:
(a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment;
(b) conduct that causes serious and imminent risk to:
(i) the health or safety of a person; or
(ii) the reputation, viability or profitability of the employer’s business.
The Respondent argues that the Applicant’s mistakes caused issues with the reputation and profitability of the business. I am not satisfied that it caused a serious and imminent risk despite acknowledging that the Applicant’s mistakes would incur the business its profits. The issues were identified on 31 October 2022, where the Respondents were copied in this email, and again on 7 November 2022. The indications that the Applicant was not dismissed until 28 November 2022 indicates that this conduct was not causing serious and imminent risk to the employer.
In consideration of all the above factors, I do find that the dismissal was harsh, unjust or unreasonable. Although there was likely a valid reason for dismissal, this was not clearly communicated to the Applicant, nor did she have an opportunity to respond. Had the Applicant been put on notice, this may have rectified some of the issues raised by the Respondent.
Given that I have found that the Applicant’s dismissal was unfair, it is necessary to consider the question of remedy. The Applicant has made an application under s. 394 of the Act in determining the Applicant’s remedy for unfair dismissal.
Remedy – Compensation
Section 390 of the Act provides that:
“390 When the FWC may order remedy for unfair dismissal
(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) The FWC may make the order only if the person has made an application under section 394.
(3) The FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.”
The Applicant and Respondent have stated that reinstatement is something that they do not wish to consider. As a result, I do not find this to be an appropriate remedy.
Section 392 sets out the considerations for awarding compensation:
“Compensation
(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
Criteria for deciding amounts
(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:
(a) the effect of the order on the viability of the employer’s enterprise; and
(b) the length of the person’s service with the employer; and
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and
(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and
(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and
(g) any other matter that the FWC considers relevant.
Misconduct reduces amount
(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.
Shock, distress etc. disregarded
(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.
Compensation cap
(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:
(a) the amount worked out under subsection (6); and
(b) half the amount of the high income threshold immediately before the dismissal.
(6) The amount is the total of the following amounts:
(a) the total amount of remuneration:
(i) received by the person; or
(ii) to which the person was entitled; (whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”
The established approach to assessing compensation in unfair dismissal cases was set out in Sprigg v Paul Licensed Festival Supermarket,[11] and has been applied and developed by Full Benches of the Commission in the context of the current Act.[12]
In short, the authorities indicate that assessing compensation involves a four-step process, noting that the guidelines are not a substitute for the words in the Act:
“Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost). I also take into account the length of service with the employer[13] and the ability to find a new role as a relevant factor in calculating compensation per s392(2).
Step 2: Deduct monies earned since termination.[14]
Step 3: Discount the remaining amount for contingencies.[15]
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount they would have received if they had continued in their employment.”
Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).
If the Respondent had provided proper notice regarding their operational requirements and had outsourced her role, I find that the Applicant would have been entitled to a 6-week redundancy as the transfer of business from Ritek Australia to Ritek Technology did not state that her previous service would not be recognised. Although the Respondent states the Applicant was engaged as a casual, her payslips indicated that she was being paid a salary, paid annual leave and superannuation entitlements.
This means that the Applicant’s estimated renumeration would have been 6 weeks amounting to $7788.39.
Step 2: Deduct monies earned since termination.
I make no deductions under this step as the Applicant had found a new role 7 weeks after her termination.
Step 3: Discount the remaining amount for contingencies.
The Applicant was dismissed near Christmas time and the industry that she was working in was in shutdown period. The Applicant is currently employed in her new role. The Applicant did attempt to mitigate her loss by finding a new role. These factors will not result in a deduction.
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.”
In Bowden v Ottrey Homes Cobram and District Retirement Villages,[16] the Full Bench noted that in relation to the fourth step, the usual practice is to settle a gross amount and leave taxation for determination. I will leave the issue of taxation for determination by the Respondent.
Viability
The Respondent is a small business and may have difficulties in repaying the amount within a short time frame. I have provided additional time for the Respondent to pay the Applicants the amount of $7788.39 in instalments.
Conclusion
The Respondent is ordered to pay the sum of $3894.19 to the Applicant’s nominated bank account that was on payroll within 30 days of issuing this Decision. The Respondent is to pay the remaining sum of $3894.19 within 60 days of issuing this decision. I Order accordingly.
DEPUTY PRESIDENT
Appearances:
D. Buttenshaw appearing for herself as the Applicant.
S. Hadid for the Respondent.
Hearing details:
Brisbane
24 May 2023
Hearing via Microsoft Teams
[1] Fair Work Act 2009 (Cth) s.394.
[2] Ibid s.396.
[3] [2023] FWC 885.
[4] Raj Bista v Group Pty Ltd t/a Glad Commercial Cleaning[2016] FWC 3009.
[5] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.
[6] Ibid.
[7] [2021] FWC 4 at 118.
[8] Chubb Security Australia Pty Ltd v Thomas (2000) AIRCFB at [41] Print S2679 (McIntyre VP, Marsh SDP and Larkin C); Crozier v Palazzo Corporation Pty Ltd [2000] 98 IR 137 at 73 (Ross VP, Acton SDP and Cribb C); Previsic v Australian Quarantine Inspection Services, Print Q3730 (AIRC, Holmes C, 6 October 1998). The principles still apply to the provisions of s.389(b) and (c) of the Fair Work Act 2009 (Cth), see William Eskander v Visy Board Pty Ltd [2021] FWC 3122 (Harper-Greenwell C) upheld in [2021] FWCFB 6036.
[9] Crozier v Palazzo Corporation Pty Ltd [2000] 98 IR 137 at 73 (Ross VP, Acton SDP and Cribb C); James Wood v Migara Recreation Club Ltd [2020] FWC 686 (Saunders DP).
[10] Explanatory Memorandum to Fair Work Bill 2008 at para. 1542
[11] (1998) 88 IR 21.
[12] Bank of Sydney Ltd T/A Bank of Sydney v Repici [2015] FWCFB 7939.
[13] Fair Work Act 2009 (Cth) s392(2)(b) -(c) and s392(2)(g).
[14] Ibid s392(2)(e)
[15] Ibid s392(2)(a), (d) and (f).
[16] [2013] FWCFB 431.
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